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3/6 Imagen Arquitectnica of Tijuana, Mexico, is contemplating a major change in its cost structure. Currently, all of its drafting work is performed by
3/6 Imagen Arquitectnica of Tijuana, Mexico, is contemplating a major change in its cost structure. Currently, all of its drafting work is performed by skilled draftspersons. Alfredo Ayala, Imagen's owner, is considering replacing the draftspersons with a drafting system. ch a computerized However, before making the change, Alfredo would like to know its consequences, since the volume of business varies significantly from year to year. Shown below are CVP income statements for each alternative: Manual System Computerized System Sales $936,000 $936,000 Variable costs 748,800 561,600 Contribution margin 187,200 374,400 Fixed costs 70,200 257,400 Operating income $117,000 $117,000 Your answer is correct Determine the degree of operating leverage for each alternative. (Round answer to 2 decimal places, eg. 15.25) Operating leverage Manual System Computarized Sustam 16
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